Business and financial analysis research

Trade War Start?


Trump's coming action against China to correct the US global trade imbalance and protect US companies, forbidden US technologies stolen or coerced by Chinese companies.  Chinese firms force them into partnerships, then steal their technology and eventually end the joint venture.  Use government funds to steal American technology secrets and innovations.   Use "cyber intrusions" into US commercial networks to spy on US commerce.  Moreover, American companies operating in China don't have the same property rights that Chinese firms do.  The about reason cause President Trump implement a series of trade strategies to increase tariffs and other penalties to resist China’s future technologies dominate of the world.   Resist China’s economic aggression to support the interests of U.S. companies.

US President Trump signed the president’s memorandum at the White House’s economic aggression to estimate China’s total value of 50-60 billion for response to China’s invasion of American intellectual property rights.  The billion US dollars of imported products will impose a 25% tariff and limit China’s investment and counter China’s “economic aggression".   At the same time, the United States even accused the World Trade Organization of China’s violation of trade law.  Affected Chinese products include Aerospace, Railway, new energy vehicles and high-tech products.  Trump’s steel and aluminum tariffs, which are tied to Section 232 of the 1962 Trade Expansion Act.  Canada and Mexico have been given initial exemptions from the 25 percent steel and 10 percent aluminum tariffs.  United States has exempted countries including European Union, Argentina, Australia, Brazil, South Korea, Mexico and Canada.

Chinese Reaction:  "A trade war does no good to anyone.  There is no winner."  Warned by China's Premier.  China believes they have confident in their capability to face up to any challenge and urge the US to cease and desist; otherwise, they will take necessary measure to defend their right and interest.  China may push back on the US, to retaliate with tariffs on US exports to China, price will likely go up for shoppers.  For example, China is one of the biggest buyers on US crops, including soybeans and sorghum.  China could put a tariff on those, or decide to buy to buy more from other countries like Brazil and Argentina.  Moreover, China is also the biggest creditor of the United States, China owns US government bonds than any other country.  Need to be take more attention for US debt holdings.

President Trump does not irrationally provoke a trade war, but rather hope to improve the US's huge trade spread to China, to reduce China's trade deficit due to China's unfair trade practices.  Therefore, although it is understood that the trade war is not a real feasible, but still uses it as a bargaining for later negotiation.

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